UPDATE 4-Bolivia nationalizes unit of Spain's Red Electrica

May 01, 2012|Reuters

* President Evo Morales cites lack of investment in Bolivia

* Move may raise concerns among foreign investors

* Takeover hits as neighboring Argentina nationalizes YPF

LA PAZ, May 1 (Reuters) - Bolivia is nationalizing the localunit of Spain's Red Electrica, President Evo Moralessaid on Tuesday, a move that could further widen the breachbetween foreign investors and the South American country.

The unit, a power transmission company that administers1,900 kilometers of power lines in Bolivia, i s called TDE.

News of the takeover came as Argentina's Congress gets setto approve the government's plan to expropriate a 51 percentstake in the country's No. 1 oil company, YPF,majority-owned by Spain's Repsol.

Morales said the expropriation of Cochabamba-based TDE stemsfrom the company's lack of investment in Bolivia, an accusationsimilar to the argument used by Argentina to justify itstakeover of YPF.

"In honor of all Bolivian people who have struggled torecuperate our natural resources and basic services, we arenationalizing Transportadora de Electricidad (TDE)," Moralessaid during an address marking Workers Day.

"We do this in the name of the Bolivian people and for thebenefit of the Bolivian people," he said, adding that he hadordered the army to take over TDE installations.

Red Electrica officials were not immediately available forcomment, but a Spanish government source in Madrid saidauthorities were in touch with La Paz to discuss technical anddiplomatic aspects of the nationalization.

In 2006, Morales used the May 1 holiday to announce thetakeover of petroleum companies operating in Bolivia. He laternationalized oil and gas reserves to redistribute wealth to thelandlocked country's indigenous majority.

Morales, Venezuelan President Hugo Chavez and Ecuador'sPresident Rafael Correa are leading a push in the region forgovernments to reclaim control over natural resources.

South America is a major supplier of commodities,particularly for the emerging economies of Asia.

Argentina, one of the world's top grains exporters, isexpected on Thursday or Friday to get final legislative approvalfor a bill taking control of YPF.